American Airlines ‘on right track’ with $1m Q3 net profit

28th Oct 2003

American Airlines’ parent company AMR Corp has reported a net profit excluding exceptionals of $1m (£590k) on revenues of $4.6bn for the quarter ended 30 September, compared with a loss of $924m (£546m) in the year-earlier period.
However, taking into account special items including those related to its restructuring programme, American recorded a loss of $23m during the quarter, versus a loss of $741m last time.
Third quarter operating profit totalled $165m, compared with an operating loss of $1.3bn in 2002, while yield was up 2.5% year-on-year, the first such quarterly lift since the first quarter of 2001.
However Gerard Arpey, AMR president and CEO, said: ‘The third quarter is a peak season for the airline industry, and under normal circumstances, we should be doing much better at this time of year than simply breaking even. We have a lot of work to do to achieve sustained profitability at acceptable levels, but we are clearly on the right track.’
Arpey pointed to an 8.1% increase in American’s mainline revenues, reflecting record July/August load factors, an 8.6% decrease in unit costs and a cash and short-term investment balance of $3.3bn at the end of the quarter as highlights of the airline’s performance.
For the future, he said American expects to boost revenue through previously announced plans, including adding seats to its Airbus A300 and Boeing 757 aircraft, and to continue its cost-cutting programme, which aims to bring about savings of $4bn pa.